How to Act in Times of Crisis When Income Is Diminishing?

When income start dropping rapidly, it’s best to react urgently, but not to panic, so as to avoid stress and making bad decisions. In such situations, you should plan various scenarios, and in line with various outcomes, you should also analyze the potential consequences thoroughly, as well as the actions which need to be taken.

Keo Sar, a co-founder of Metamall Group, the advisor for the strategic growth of the company in Chicago and one of the mentors within the accelerator program NINJA, says so in an interview for Blic Biznis.

– It is very important to try to understand what can be controlled and what cannot be. You then make decisions and execute them. Try all you can not to question them – he starts his interview.

The first company with which Keo Sar worked entered the stock market with USD 8 billion. A company he had worked with was taken over by a bigger competitor, and another one reached the unicorn status.

He is now a mentor within the NINJA accelerator program, a new project of support to startups, organized by the Digital Serbia Initiative in partnership with the Japan International Cooperation Agency (JICA). This three-month program opens the door to mentoring sessions, potential investors, possibilities for the development of business operations and entering new markets. Applications are open until October 1.

– Income growth is the responsibility of all, but, of course, someone has to be ultimately responsible, which is something that I have been doing for a long time now. Approaches to income growth will differ depending on the phase the company is in. Still, my opinion is that the basic things to keep in mind when it comes to income growth, which I believe have to be there regardless of the phase or the size of the company, are:

– culture – there has to be a strong culture. That is what should gather people and keep them together when things become difficult, which inevitably happens in every organization.

– goals – the goals mustn’t be unclear, but crystal clear and everybody should know what they are. They begin at the company level and should go down to the individual level so as to ensure a harmonized moving toward income growth;

– process and conduct – true processes have to be implemented, and the team of employees should be focused on executing the right things, which is a process that requires constant improvement;

– people – what this is about is that, at the company, you should have an adequate talent employed in adequate roles. There should be a clear understanding which characteristics a person should have in order to be successful at a company;

– data and analytics – how do we know that we are on the right path toward the desired results or we are behind? The possibility of monitoring the performances and gaining insight into the business operations on time is of crucial importance for achieving success of both the team and the whole organization – Sar says.

He also clarifies what the key steps are that should be taken when income starts dropping unexpectedly:

– I enter the regime of research and information gathering. That means that I go through a range of “why” questions, diving into a large quantity of data in order to confirm or refute my assumptions in the process. In order to solve a problem or problems, you need to understand why they happen. In that process, I also cooperate with the managers of related departments, in order to understand the problems. From there, I like to create a range of logical solutions in order to start the testing. That helps me better understand how actions are related to the outcome or lack thereof. Getting timely and reliable data (insight) is also a very important part of this process.

But, to keep yourself sane and have some perspective, you should also keep in mind that, sometimes, problems happen on a macro level and that they are outside your control. The coronavirus pandemic and the energy crisis are excellent examples of macro problems. In such cases, the focus should be on trying to understand how the circumstances on the macro level influence your operations and taking action regarding what can be controlled.

When asked how to act in moments of crisis when income start dropping due to external unforeseen factors, he says:

– For a start, I would say react urgently, but don’t panic. Panic often leads to stress, which can lead to bad decisions. In such situations, I like to plan different scenarios. In line with the various outcomes and variables in planning scenarios, you realize which actions you should take and what the consequences could be. Also, it is very important to try to understand what can be controlled and what cannot be. Then you make decisions and execute them. Try your best not to question them.

He also shared a piece of advice which could be applicable to all organizations.

– This could go in several different directions, but I think I will pick the following ones – hard skills advice (note – so called technical skills, academic competences acquired through education and training, that is, skills measurable by degrees and titles):

– make a business plan which is in line with what you’re trying to achieve and the results you want to achieve;
– learn as much as you can about your company’s finances;
– employ the right people and let them do their job.

And soft skills advice (note – a combination of several skills, including social, communication, interpersonal, skills, ability to adapt, work under stress, multitasking etc.):

– you are probably underestimating the influence of culture;
– remember why your company exists and why you CHOOSE to do it every day;
– you don’t have to realize all this today, but understand what you need to do today in order to progress and upgrade your business.